Tue, Feb 19, 2013 - Page 13 News List

TAIEX gains 0.5% on reopening

CAUTIOUS:The market’s rise on opening reflected the positive sentiment around the world during the holiday, but it later fell in line with regional trends

By Camaron Kao  /  Staff reporter

A person dressed as the God of Wealth hands out mock gold coins to sales staff at their office in Taipei yesterday, as the stock market advanced on the first day of trading following the Lunar New Year break.

Photo: Chang Chia-ming, Taipei Times

The TAIEX surged 1.25 percent on opening yesterday to an 11-month-high of 8,005.75 points, as investors chased shares in the financial and optoelectronics sectors after the nine-day Lunar New Year break, analysts said.

Strong buying in market bellwether Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) drove up the bourse in early trading, but the index later gave up its gains, falling below the 8,000 mark to close at 7,943.93, up 0.47 percent from the previous trading session.

Turnover was NT$95.52 billion (US$3.23 billion), Taiwan Stock Exchange data showed.

“The market performance early this morning reflected the positive market sentiment around the world during the Lunar New Year holiday, but the TAIEX started to decline when share prices in South Korea and China fell,” Winson Wang (王榮旭), an analyst at Marbo Securities Consultant Co (萬寶證券投顧), said by telephone.

The market got a lift from buying in financials following robust revenue reports and in large-cap TSMC, Wang added.

TSMC closed up 1.9 percent at NT$107 yesterday, following the strong showing of its American depositary receipts on Wall Street during the holiday.

Financial shares led the rise in the TAIEX, closing up 0.8 percent, after the Financial Supervisory Commission announced two days ago that it was revising regulations to allow Taiwanese securities companies to invest in China’s securities markets in the near future.

However, it was the optoelectronics sector that posted the biggest increase at 3.17 percent. Electronics also fared well, rising 0.7 percent because of better-than-expected revenues last month and new product launches.

Plastics posted the biggest fall, down 1.37 percent, while telecoms dropped 1.11 percent.

Wang said it was not surprising that telecoms and plastics fell after the Lunar New Year holiday because risk-averse investors usually picked up those stocks before the long holiday break and sell them once the market reopens.

Wang forecast that the TAIEX could hit 8,500 points by June, propelled by gains on financial and biotechnology shares.

Schroders PLC vice president Tony Chen (陳同力) was cautious, saying the benchmark index would not stay above 8,000 points unless the share prices of larger companies also started to rise.

Small-cap stocks outpaced big-cap issues in yesterday’s trading.

Chen said he was cautiously optimistic about the local stock market as global economic conditions have improved and companies are registering higher profits.

He forecast that the TAIEX would peak between the end of the second quarter and third quarter.

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